2024-10-30 05:25

MUMBAI, Oct 30 (Reuters) - The Indian rupee was flat against the dollar on Wednesday in the run up to important U.S. data and presidential election, while forward premiums rose in response to the dip in U.S. Treasury yields. The rupee was at 84.0750 to the U.S. dollar at 10:50 a.m. IST, unchanged from the previous session. Other Asian currencies were mostly weaker, the dollar index was slightly higher and Indian equities dropped. The U.S. September core PCE data is due on Thursday followed by the October jobs report the following day. The U.S. election is on Nov. 5. "The U.S. election holds major implications... for all markets and there will be a lot of nervousness till that is out of the way," a currency trader at a bank said. The rupee "right now is not going anywhere", but it would be a mistake to position counting on this stability to continue post the U.S. election outcome, he said. The odds of former President Donald Trump winning have risen in recent days, a development which has pushed the dollar higher and lifted U.S. Treasury yields. Still, the odds of Trump winning are only slightly more than a coin toss. "Even if it looks like they now assign a higher probability to a Trump win and a Republican sweep, there is still a lot of uncertainty," Capital Economics said in a note. "We judge that there is ample scope for a sizeable move (across markets) in the days after the election." The 10-year U.S. Treasury yield, which has been pushing higher on bets of a Trump win, pulled back on Tuesday amid a soft U.S. job openings data. Tracking the decline in U.S. yields, the dollar/rupee forward premiums rose with the 1-year implied yield up 3 basis points at 2.28%. Sign up here. https://www.reuters.com/markets/currencies/rupee-unmoved-before-key-us-data-election-premiums-rise-2024-10-30/

2024-10-30 04:54

Headline CPI at 2.8% in Q3, back in RBA's target band of 2-3% Core sticky at 3.5%, services inflation picks up Data supports view of 2025 rate cuts; muted reaction in markets SYDNEY, Oct 30 (Reuters) - Australian consumer price inflation slowed to a 3-1/2 year low in the third quarter, though the core measure was still sticky and reinforced market wagers that the central bank won't start cutting rates until next year. Overall, the report was rather mixed, with consumers benefiting from government rebates on electricity and a drop in petrol, while services price pressures persisted. That kept market reaction muted. Investors slightly pared the chance of a rate cut from the Reserve Bank of Australia this December and next February to just 24% and 44%. Markets still see April next year as the most likely timing for the first easing. Data from the Australian Bureau of Statistics on Wednesday showed the consumer price index (CPI) rose 0.2% in the third quarter, under forecasts of a 0.3% increase. Annual inflation dropped to 2.8%, from 3.8%, taking it back into the RBA's 2-3% target band for the first time since 2021, a result that was largely expected. The slowdown was driven by a 17.3% drop in electricity prices due to the government's subsidies, while petrol fell 6.2% in the quarter. Policymakers are more focused on core inflation and the trimmed mean measure increased by 0.8% in the quarter, just above forecasts of a 0.7% gain. The annual pace though slowed to 3.5% from 4.0%. Commonwealth Bank of Australia on Wednesday abandoned its call for a first rate cut in December as the core measure was a touch firmer than it had expected. It is now pencilling in a cut in February next year, along with the other three big banks in Australia. "The process of normalising the cash rate will be a story for 2025," said Gareth Aird, head of Australian economics at CBA. Services inflation remains a source of concern for the RBA, staying elevated at 4.6% in the third quarter, slightly higher than the June quarter's 4.5%, and little changed over the past 12 months. The central bank will have an updated set of economic forecasts when it decides on its next policy move on Tuesday. The slow easing in inflation had Australian grocer Woolworths (WOW.AX) , opens new tab warning on Wednesday that earnings from its food division may fall as price-conscious consumers hunt for bargains. POSITIVE IMPULSE For September alone, CPI rose a muted 2.1% compared with a year earlier, the lowest since July 2021. The trimmed mean measure slowed to 3.2%, just a touch above the top of the target band. The RBA has held its policy steady since November, judging the current cash rate of 4.35% - up from 0.1% during the pandemic - is restrictive enough to bring inflation to its target band of 2-3% while preserving employment gains. The labour market has stayed surprisingly resilient, an argument against early rate cuts. But the easing in annual core inflation comes ahead of the RBA's projection for it to slow to 3.5% by the end of the year. "Although quarterly trimmed mean CPI is not yet rising at pace consistent with the RBA’s target range, we think it will do so before long," Abhijit Surya, Australia and New Zealand Economist at Capital Economics. "That should pave the way for the Bank to begin easing policy at its meeting next February," said Surya. Sign up here. https://www.reuters.com/markets/australia-q3-inflation-slows-3-12-year-low-core-remains-sticky-2024-10-30/

2024-10-30 03:36

Inflation no obstacle for economy, c.bank official says Policy rate should stay neutral Government eyes inflation at 2% level, finance minister C.bank says economy should grow close to potential in 2025 BANGKOK, Oct 30 (Reuters) - Thailand's policy interest rate is at an adequate level to address economic risks as the recovery is uneven, while the current inflation target range of 1% to 3% remains appropriate, the central bank said. After resisting repeated calls by the government for easing, the Bank of Thailand's monetary policy committee on Oct. 16 unexpectedly voted 5-2 to cut the one-day repurchase rate (THCBIR=ECI) , opens new tab by 25 basis points to 2.25%, the first decrease since 2020. Two members voted to keep the rate steady. "The current policy rate remained adequate to address risks to the outlook for the economy, inflation, and financial stability," according to the minutes , opens new tab of the meeting released by the BOT on Wednesday. The policy rate should remain neutral and consistent with economic potential, and it should not be so low that financial imbalances would build up in the long term, senior central bank director Surach Tanboon told a monetary policy forum. The next rate review is on Dec. 18. BOT Deputy Governor Piti Disyatat told Reuters last week the current policy stance was well balanced and the rate cut was a recalibration, not the start of an easing cycle. Piti on Wednesday told Reuters that talks this week between the central bank and the finance ministry over the inflation target were "constructive". The government and BOT agreed at the meeting to maintain the current inflation target for 2025, in return for assurances the BOT would support fiscal policy and help kick-start growth, Finance Minister Pichai Chunhavajira said afterwards. NO INFLATION CONCERN The government wanted actual inflation at 2%, the midpoint of the range, the finance minister added, as it was currently too low - just 0.20% in the first nine months of 2024. At Wednesday's monetary policy forum, Piti said inflation was low and stable and was not an obstacle for the economy, which was expected to expand close to its potential next year. "We want to see inflation that is not a problem ... the range of 1% to 3% does not hinder economic activities," he said. All felt the current range was appropriate, Piti said. "All parties agreed that inflation in the framework is a good thing, and if it rises because the economy expands, it is not an issue," he added. The BOT expects headline inflation, which was at 0.61% in September, to return to within the target range late this year. It predicts average inflation at 0.5% this year and 1.2% next year. At the Oct. 16 meeting, the BOT raised its 2024 GDP growth forecast to 2.7% from 2.6% but trimmed its 2025 outlook to 2.9% from 3.0%. GDP growth was 1.9% last year. ($1 = 33.73 baht) Sign up here. https://www.reuters.com/markets/rates-bonds/thailand-economic-recovery-uneven-central-bank-minutes-rate-cut-meeting-show-2024-10-30/

2024-10-30 00:45

SYDNEY, Oct 30 (Reuters) - Australia's consumer price inflation rate fell to its lowest since early 2021 in the third quarter on government rebates on electricity and a drop in gasoline, while a drop in core inflation supported the case for an eventual cut in interest rates. Data from the Australian Bureau of Statistics on Wednesday showed the consumer price index (CPI) rose 0.2% in the third quarter, under forecasts of a 0.3% increase. Annual inflation dropped to 2.8%, from 3.8%, taking it back into the Reserve Bank of Australia's (RBA) 2%-3% target band for the first time since late 2021. The RBA is more focused on core inflation and the trimmed mean measure increased by 0.8% in the quarter, just above forecasts of a 0.7% gain. The annual pace slowed to 3.5% from 4.0%, with service-sector inflation still elevated. Sign up here. https://www.reuters.com/markets/australia-q3-inflation-slows-3-12-year-low-core-more-stubborn-2024-10-30/

2024-10-30 00:41

RIO DE JANEIRO, Oct 29 (Reuters) - The head of Brazil's environmental agency Ibama chose to not reject a request from state oil company Petrobras to drill near the Amazon river, documents seen by Reuters showed on Tuesday, even after experts at the agency advocated the request be dismissed. Ibama chief Rodrigo Agostinho instead asked Petrobras (PETR4.SA) , opens new tab for further details concerning Petrobras' requested offshore drilling license for the Foz de Amazonas area off the coast of Amapa state, according to the regulatory documents. Ibama last year blocked Petrobras from drilling the well, but the company filed a new request, which the agency is assessing. Ibama has no deadline to judge the appeal. The decision defied a report from Ibama's technical area, seen in another document, which recommended Agostinho close the case because Petrobras' appeal did not provide "sufficient elements" for revisiting Ibama's original decision. The area is part of Brazil's Equatorial Margin, which Petrobras considers its most promising new frontier for oil and gas exploration. The decision to drill in the region and stoked controversy due to the zone's biodiversity and proximity to the Amazon rainforest. Ibama's technical area also argued that Petrobras' request did not present a "viable alternative" to "satisfactorily mitigate the loss of biodiversity in the event of an oil spill accident." However, Agostinho said that Petrobras has shown progress that allows the environmental agency to keep analyzing and for talks between Ibama and Petrobras to continue, according to the documents. Petrobras did not immediately reply to a request for comment sent outside of regular business hours. Sign up here. https://www.reuters.com/markets/commodities/brazils-ibama-seeks-data-petrobras-amazon-project-rejects-advice-kill-it-2024-10-30/

2024-10-30 00:26

Brent, WTI climb more than 2% OPEC+ could delay planned December oil output hike, sources say Oct 30 (Reuters) - Oil prices rose more than 2% on Wednesday, after Reuters reported OPEC+ could delay a planned oil production increase scheduled to take effect in December by a month or more, due to concerns about soft oil demand and rising supply. Brent crude futures gained $1.41, or 2%, to $72.53 a barrel by 1236 GMT. U.S. West Texas Intermediate crude futures edged up $1.34, or 2%, to $68.55 per barrel. OPEC+, which groups the Organization of the Petroleum Exporting Countries and allies such as Russia, is scheduled to raise output by 180,000 barrels per day in December. The group has cut output by 5.86 million bpd, equivalent to about 5.7% of global oil demand. "OPEC+ has always advised that the unwinding of voluntary supply cuts would be subject to market conditions," said Harry Tchilinguirian, head of research at Onyx Capital Group "That they may be reconsidering the timing of a return of their barrels is not surprising given the weak macroeconomic realities, particularly in China, which have led to downward revisions in global demand growth estimates," Tchilinguirian said. A decision to postpone the increase could come as early as next week, two of the sources told Reuters. OPEC+ is scheduled to meet on Dec. 1 to decide its next policy steps. Sign up here. https://www.reuters.com/markets/commodities/oil-prices-steady-shrinking-us-crude-inventories-2024-10-30/